The revised area planted estimate and second production forecast for summer crops for 2016 was this morning released. Click to open CEC media release»

Policy and Legislation

Agbiz response to Minister Pravin Gordhan's 2016 Budget Speech

"Not in the last two decades has there been as much interest in and anticipation of the annual budget speech of the Minister of Finance, as was the case with Minister Pravin Gordhan's 2016 Budget Speech. Against the background of South Africa's poor and declining economic performance, a tight global economic situation, and the threats of downgrades of South Africa to so-called 'junk status' by rating agencies, Minister Gordhan was under considerable pressure to deliver a budget speech that indicated a new economic direction of inclusive growth and a better future for all, but also reined in excessive and wasteful state expenditure," Dr John Purchase, CEO of Agbiz, said today. Read full Agbiz Press Statement. Read full Agbiz press statement»

Agbiz CEO John Purchase on #Budget2016: New direction, new hope for agriculture

- Alec Hogg, Biznews

With South Africa's agricultural sector having experienced its driest year since records started in 1904, farmers have the backs very much against the wall. Overlay years of anti-business sentiment and the national food security concerns loom large. Dr John Purchase, CEO of Agbiz reckons there were green shoots of hope in Budget 2016 as Pravin Gordhan confirmed the new direction which appears to becoming entrenched. But as with SA business generally, he believes that although what was contained in the speech is a move in the right direction it will take time - 12 to 24 months - and execution of proposed changes for trust to be rebuilt. Listen here»

2016 Budget Speech and Budget Review

Please click on 2016 Budget Speech to peruse the full text of Minister Pravin Gordhan's address to Parliament and South Africa on 24 February 2016. To peruse full detail of government's budget for 2016/17, please click on 2016 Budget Review.

The trend that began three years ago of a reduced number of substantive amendments announced in the Budget continued this year. Contrary to widespread expectations, there was no increase in the VAT rate. Wise as an increase might have been, it would have been politically difficult in an election year. Of concern for commercial agriculture is the sharp increase in Capital Gains Tax (CGT). Please click on Werksmans: Tax Amendments to peruse detail on CGT changes and other relevant tax amendments.

Although the latest above-inflation hikes in excise duties may add to what is anticipated to be a challenging year ahead, the South African wine and brandy industry welcomed specific concessions on brandy and sparkling wine. Media release»

Update on implementation of Carbon Tax

While an announcement on the implementation of the controversial Carbon Tax was expected in the 2016 Budget Speech, the Carbon Tax issue was only dealt with in the 2016 Budget Review, and as follows:

The main aim of the carbon tax is to put a price on the environmental and economic damages caused by excessive emissions of greenhouse gases. A secondary aim is to change the behaviour of firms and consumers, encouraging them to use cleaner technology. Given the economic outlook, the carbon tax has been designed to ensure that its overall impact will be revenue neutral up to 2020. The draft Carbon Tax Bill was published in November 2015, with 90 comments received to date. The draft bill will be revised, taking into account public comments and further consultation.

Agbiz, through BUSA primarily, will continue to engage National Treasury on the matter to ensure that the revenue neutral position is maintained. South Africa cannot afford that an increase in the cost of doing business undermines the global competitiveness of the agribusiness sector and compromises food security as a result.

The Centre for Scientific and Industrial Research was summoned by the Portfolio Committee on Water and Sanitation to provide an overview of water resource management in SA, with specific reference to: Present the water balance (supply and demand) of SA; Comment on efficiency vs equity vs effectiveness vs sustainability; and Interpret the role of water for the NDP 2030 vision. Please click on CSIR presentation to peruse.

Southern Africa is currently in the grip of an intense drought that has expanded and strengthened since the earliest stages of the 2015-2016 agricultural season, driven by one of the strongest El Niño events of the last 50 years. Much of southern Africa has consequently experienced significant delays in planting and very poor conditions for early crop development and pasture re-growth. Read more»

This e-learning course has been designed to support countries and regions in planning all the information needs for monitoring, pilotage and evaluation during the life of their Food and Nutrition Security and Agriculture programmes. The course offers practical guidance on building a Monitoring and Evaluation (M&E) system which is feasible, practical and relevant to the programme's needs. Although the course focuses on large-scale development programmes that address food insecurity, the approaches and methods presented are equally applicable to smaller projects. More information»

South Africa has in recent years made significant investments in the domestic soybean crushing capacity. Theseinvestments led to increases in the crushing capacity of approximately 2,2 million tons. Read more»

With all eyes on Minister Pravin Gordhan as he prepares for his Budget Speech next week, one thing that is certain is that 2016 is going to be a tough year for South African consumers. This is according to Old Mutual Investment Group Senior Economist, Johann Els, who says that a looming ratings downgrade, the falling rand and rising inflation means that Treasury will have to hike taxes even more significantly this year than in the previous few years, and much of this burden will land on consumers' shoulders. Media release»

The severe drought affecting vast swathes of land in South Africa is looming over food producing companies large and small. At its AGM in Malmesbury, management at agricultural products and services company, Kaap Agri, warned that the drought would wipe millions off the company's bottom line. The current wheat crop in the Swartland region is estimated at 40% below average and this will have a direct impact on grain handling and storage revenue. Read more»

Regarded as the market's leading pan-African trade finance gathering, GTR Africa Trade Finance Week will return to Cape Town in March 2016. GTR are giving Agbiz a limited amount of free corporate passes for exporters, importers, traders, manufacturers, distributors and producers of physical goods only. All members thereafter receive a 15% discount with the code AGBIZ15. More information»